Taxes for People or Taxes for Buildings

AISD trustees ask long term funding priority question

AISD Trustee Robert Schneider:
AISD Trustee Robert Schneider: "If the state’s not willing to assist us and aid our kids in public education, we ought to be doing everything we can." (Photo by John Anderson)

So there is a simple question spinning out of last night's Austin ISD Board of Trustees meeting: Will the district go for a tax election to cover operating costs first, or a bond election to pay for buildings?

There were two major pieces of business on last night's agenda. One, passing the 10 year Facility Master Plan from the task force to Superintendent Meria Carstarphen while getting as few board fingerprints on it as possible. Two, severing 1,136 positions before the next school year through a reduction in force.

The night was a little weird, to say the least. The master plan is no longer a master plan per se, but now just a report (read more about that in Thursday's issue) that will be turned into executive recommendations by Carstarphen. Then, in a Chronicle of a Death Foretold moment, the board moved forward with the RIF in three votes, splitting about the necessity for the job losses when there are still non-personnel cost saving exercises still on the table.

But the big shakeout of the night is that the board is going to have to go back to the voters for more money. They are just not sure what kind of money, and when.

The one question asked most often about school finances is the difference between a tax rollback election (TRE) and a bond election. Here's how it works:

1: A TRE goes to pay for maintenance and operations (M&O), which cover wages and day-to-day costs. The board has to ask voters to increase the tax rate per $100 of valuation.

2: A bond election pays for infrastructure, like buildings and computers. The district asks voters if they would like certain projects, like, say, a new elementary school. If voters approve the project, then the board can issue bonds to pay for it. Those are paid for out of a different bit of the tax bill, called interest and sinking (I&S).

Now here's the complex bit. The board has to ask permission from voters to raise the M&O rate: But since voters have already approved the issuance of bonds, they do not have to ask permission to raise the I&S rate to cover those debts.

Confused? Of course you are.

Now protesters opposed to the facility master plan have argued that its data about disrepair in district schools is, well, flat-out wrong, and the board seemed to accept that argument last night. Much of the blame seems to have been laid at the feet of Magellan Consulting, which produced the facility condition index (FCI) data that is so core to all future planning. Robin Rather summed up the general feeling when she called the report "data embarrassing and data worthless." With parents pouring over the end result, she said, they had reached the conclusion that "the data’s not off by a little … it is pervasive."

However, there is undoubtedly deferred maintenance in the district, and the board made non-committal but positive noises towards having a bond some time soon. However, here's where the facility master plan causes problems. It was supposed to be what guided all infrastructure decisions, but the board has somewhat publicly, somewhat tacitly conceded that there are serious problems with the FCI.

So they want Carstarphen to look over that data again. Her concern was that too much debate might slow up essential repairs. “If you’re serious about doing another bond soon," she said, "this cannot drag on for years.”

But the simple fact is that AISD's most pressing need is for immediate M&O cash: If they had more of that, then they would not be laying staff off at a frightening rate. The legislature is deep in the budget fight, and the best case scenario still sees AISD down $60 million from last year. So there is increasing pressure for the district to take matters into its own hands, buck up and go for a TRE.

The board was going to push for a five cent TRE last November, but buckled in the face of business community pressure. Prominent local consultant Alfred Stanley charged straight at the district last night over their refusal to countenance a TRE. "Why is this off the table?" he asked, before advising the board to go for the full nine cent raise permissible by law. This would raise the M&O to $1.32 per $100 valuation which, he said, "is still considerably lower than the $1.63 we were paying in 2005."

Education Austin co-president Ken Zarifis was a little more measured in his tone, but equally critical of the district's failure to take charge of its own financial destiny. While "the lion’s share of responsibility" for the school funding crash lies with the capitol, he said, the board needs to have "faith in our community that they will support education, to save kids and save our teachers, even if the legislature will not."

Surprisingly, the board and Carstarphen both started making the first gestures towards a TRE. Unfortunately, the time line may be the snag. To make a real case to voters, Carstarphen said, she would need to know by the start of the next school year about having a TRE in place for the 2013 school year. Since Stanley was proposing a Summer 2011 TRE, that kind of super-longterm, slow motion approach may not sit well.

The same stat kept coming up, from both Carstarphen and Board President Mark William: With a full nine cent TRE, AISD would raise $49 million but only keep $27 million. The rest would go to the state under the "Robin Hood" recapture system. Carstarphen said the district would need a TRE by the 2013 school year, but implied it would be impossible to do before then. Trustee Robert Schneider took a much more immediate and pragmatic view: "If the state’s not willing to assist us and aid our kids in public education, we ought to be doing everything we can."

So which comes first? Board vice-president Vince Torres said the district needs a bond election "sooner rather than later, and perhaps sooner than a tax rollback election." But Schneider was more favorable towards going for the TRE first, adding that, due to both political and practical reasons, “We are a long way from going for a bond.”

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AISD, State Budget, Meria Carstarphen, M&O, Maintenance and Operations, I&S, Interest and Sinking, Tax Rollback Election, Facility Master Plan Task Force, Mark Williams, Robert Schneider, Vince Torres, Austin Independent School District, Board of Trustees

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